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Managing Your Debts With A Bankruptcy Trustee In Scarborough

A bankruptcy trustee in Scarborough can help you sort out your bankruptcy petition and debt problems and aid you in paying your creditors back in order.

Let a bankruptcy trustee in Scarborough guide you through filing for bankruptcy and dealing with unpaid debt. In life, there are many instances where you’d need to take out a loan to pay bills or to take care of emergencies, and things get out of control.

If you ever find yourself on the verge of filing for bankruptcy, always remember that options are still available. You aren’t alone when filing a bankruptcy petition; a bankruptcy trustee’s job is to assist you throughout the process.

You won’t have to worry about how to start your petition or how to deal with your current creditors. Trustees have a variety of roles and responsibilities wherein they aid both parties in the case to reach a compromise and have a proper repayment plan.

In Bankruptcy, What Is the Role of The Trustee?

When you file for bankruptcy and request the help of a trustee, you will be appointed one by the court. These professionals have knowledge and skills regarding legal issues in bankruptcy, accounting, business, and management.

Trustees are there to oversee the bankruptcy process and manage the case when needed. Depending on the type of insolvency case, trustees or Licensed Insolvency Trustees (LITs) have the power to ensure the process is followed under the law.

LITs are compensated for the services they offer. For administering the process, they receive a commission based on the percentage paid to the holders of the secured claims. Their payment falls upon reasonable expenses depending on how the case goes.

How Do You Work With A Bankruptcy Trustee?

It all begins when you file for a bankruptcy petition. Once the petition gets approved, the court appoints a LIT to handle your case. You get a notice with all the information you need to contact the LIT assigned to you.

What might surprise you is that you only get to meet the LIT assigned to you once you go to the meeting creditors. All information presented to the court goes through the trustee, who will verify your assets and liabilities.

If you have any questions about the bankruptcy process, you can always ask the trustee assigned to you. They can answer your questions and advise you on the best options for your case. 

The Role Of A Bankruptcy Trustee

A LIT has many different roles, depending on the kind of bankruptcy petition they’ve been assigned. They can handle more or fewer roles or control when the situation needs it. Trustees are always expected to mediate the case and to be entirely unbiased.

Facilitates The Meeting Of Creditors  

LITs facilitate the 341 meetings or the meeting of creditors, which is mandatory for debtors to attend. Trustees will ask you about your financial situation and the legitimacy of your documents. The sessions are often short, and only some creditors are required to attend.

Can Object To Discharge

A trustee can object to a discharge when there are false statements from the debtor to the trustee or judge. It happens when fraudulent activity is spotted in the proceedings or in the paperwork that the debtors provide.

Review Or Approve Loan Cram-Downs

Cram-downs often happen when the court is imposing a bankruptcy reorganization plan. It still happens even when there are objections from creditors. Trustees have the responsibility of reviewing or approving these types of procedures.

On The Debtor’s Side:

Reviewing The Debtor’s Financial Data

LITs are tasked to review all the data you submit to the court. All your paperwork must go through a trustee when filing a bankruptcy petition. They will also decide whether you need to provide more documents or prove that your documents are legitimate

Examining The Debtor’s Property And Assets

The trustee assigned to you will also have to look up your assets and property. It‘s essential to have a third party check them to ensure that everything is well accounted for and put into writing before finalizing any documents.

Liquidating And Collecting The Debtor’s Nonexempt Property And Assets

The debtor’s assets and properties are evaluated, measured, and liquidated by the LIT. The procedure is done to repay unsecured debts or other related debts properly. The way that the creditors are paid is through priority.

Handling The Sales Of The Debtor’s Property Or Assets

The trustee’s responsibility is representing the debtor in selling their property under a bankruptcy proceeding. They are also responsible for reorganizing a debtor's business or any assets that would continue operation after the bankruptcy petition.

Converting Debtor Assets To Cash

As the LIT is in charge of the debtor’s assets and properties throughout the bankruptcy proceeding, they also have the power to convert the assets into cash. It’s done so that the LIT can pay off creditors on the priority list easier.

Reviewing Exemptions Claimed By The Debtor

In a bankruptcy petition, debtors can claim several reasons they should be qualified for bankruptcy. It’s the LIT’s job to check whether the claims are valid and if the bankruptcy petition is legitimate enough for approval.

The Creditors' Meeting: Why Does It Matter?

You might often come across the creditor's meeting or the 341 meeting and wonder why it’s crucial. In the meeting, trustees must verify your identity and current financial documents. You have to be prepared with all your documents and paperwork for the presentation.

The LIT can also ask you questions under oath to verify whether the information you’ve given is accurate and truthful. Meetings like these are essential to help sort out your financial situation and give creditors an idea of your ability to repay your debts.

Once the meeting concludes, you can talk with the LIT to turnover nonexempt property. The LIT can then assign you a schedule based on the repayment plan you and the creditors agreed upon.

Are Trustee Relationships Important?

You can work things out better if you are familiar with a LIT's different roles and responsibilities. Understanding how bankruptcy works will make your and the LIT's responsibilities more manageable and timelier.

That means you can provide the documents and paperwork the LIT needs without getting confused. You are also aware of the actions that the trustee can take within the bankruptcy process.

You can also ask questions regarding the process of the LIT. Remember that you are working with the trustee, and a strong relationship comes from respect for each other’s roles in the procedure. You can contact a bankruptcy trustee in Scarborough if you have more queries.